Kamala Harris and Now Beto, Falter and Become Defenders of Capitalism

UPDATED, MARCH 14, 2019–In his announcement today saying he was entering the 2020 presidential race, Congressman Beto O’Rourke (D-Texas) dispelled his maverick image by saying he was a capitalist.

In his announcement, O’Rourke, who has few legislative accomplishment to tout, said “”I’m a capitalist. I don’t see how we’re able to meet any of the fundamental challenges that we have as a country without, in part, harnessing the power of the market.” It is not clear what he meant about the how the market works in an unregulated capitalist economy, but he has positioned himself to the right of the progressives.

O’Rourke’s announcement that he is a capitalist is similar to the one Democratic presidential contender and Senator from California Kamala Harris made earlier when she said. “I am a capitalist.” Harris’ statement came a few days after she denied being a democratic socialist.

The Harris interview was done the same day Senator Bernie Sanders (Ind.-VT) announced he was entering the presidential race as the proud standard bearer of democratic socialism.

Harris’ and O’Rourke’s flippant and implied defense of capitalism is a big mistake for someone seeking the Democratic nomination. The reason: she should be put on the defensive by other liberal Democrats for defending her version of capitalism.

In stating that she is defending capitalism, does she mean the unregulated capitalism that caused the 2008 recession and housing crisis? Does she mean she is defending neoliberal capitalist economic policies that have caused wage stagnation since the Reagan administration? Does she mean the capitalism synonymous with the deregulation of investor, environmental and voter protections? The capitalism that has caused the decline of the middle class or the need for average families to have more than one job to make ends meet? Or, the capitalism that now means 57% of Americans have less than $500 in their savings account?

Harris’s statement that she is a capitalist was not well thought out; certainly not one of presidential caliber. Why would a black female defend a system where the majority of her cohorts have not been allowed to enjoy the supposed fruits of a competitive, laissez faire, free enterprise system that rewards those who work hard, live by the rules and live a frugal life?

Capitalism in 2019 is not the same capitalism that existed at the time of Adam Smith. Capitalism today is neoliberal capitalism and that has a very bad reputation among its victims in the Third World, Europe and the U.S. Neoliberal capitalism is too technical for presidential debates and Sanders has brilliantly avoided its name, but not its ill-effects. These bad results include privatization, unprecedented wealth concentrations, and social policies designed to disenfranchise and alienate people who have essentially become wage slaves.

I have been covering retirement and related investment issues for almost 40 years and here is how neoliberal (contemporary capitalist) policies have affected retirement, an issue of concern to all Americans. “The neoliberal priority on reducing labor costs and achieving maximum shareholder value has created an environment inimical to maintain the traditional system of pension and health care benefits in both the private and public sectors,” authors Larry Polivka, and Baozhen Luo, write in their paper, “The Neoliberal Political Economy and Erosion of Retirement Security,” (The Gerontologist, 2015, Vol. 55, No. 2, 183–190).

The authors then go on to give a helpful, succinct comparison between traditional capitalism and the modern form of neoliberal capitalism. The authors then make the comparison:

“How does neoliberalism differ from classic capitalism? Classical theories of capitalism focus on the functions andvalue of markets and on a narrow definition of state functions so that they are limited to contract enforcement, police protection, and defense against foreign threats.

“Neoliberalism, on the other hand, is defined by the growth of very large corporations, monopoly control of many markets, increasing corporate penetration of the state through corporate-friendly regulatory, trade and labor policies, privatization of public services and assets, low taxes on wealth and high incomes, the growth of the financial sector, and reduced spending on publicly funded and managed health, education, and social services programs.”

Does Harris endorse neoliberal capitalist policies that favor the ascent of the corporation over individuals, as seen in the Citizens United case that allowed corporations to make unlimited purchases of politicians? Or the neoliberal-capitalism that gave use the ascent of Libertarianism, a radical form of individualism and selfish consumption?Harris as the Capitalist, Corporate Lawyer?

Harris has put herself in a big hole by inadvertently becoming a defender of a socially destructive system. The American public does not want a class on the comparison between different economic policies. What Americans want are answers to the problems caused by neoliberal-capitalist policies that have been degrading American society since the 1970s.

Harris is a former prosecutor in Los Angeles County, so she has seen how the big money works in the legal system. Corporate lawyers garner the huge salaries and can often come from the public side of the system as states attorneys or public defenders. Harris stayed on the public side earning a public employee’s salary. Now, perhaps she wants to make up for lost time, so she can earn the big salary. She may even have a role model.

Eric Holder: Self interest above justice

Eric Holder, the Attorney General under Obama, was known as being unwilling to prosecute the bankers and real estate executives (he is credited with creating the slogan “Too big to jail”) that caused the 2008 recession. Holder was making $2.5 million in 1999 before he became Attorney General. After he left the Justice Department, he returned as a partner to the Washington law firm of Covington & Burling, which specializes in corporate defense, in April 2015. The law firm was so confident that he would return to private practice after his government service that it kept his office intact while he was Attorney General. Holder has an estimated net worth of $12 million.

Holder, who had the audacity to announce he was running for president and probably helped elect Trump by not putting any bankers in jail, may be a role model for Harris. Is the capitalism she is defending the one that allows Holder and the lobbyists and corporate lawyers to manipulate the government ? Or, is there another definition of capitalism she has in mind.

In any case, if the public and the media want answers about which form of capitalism she is defending, we will get a better idea of who she is really representing. Let’s hope it is average Americans.

Chuck Epstein

Chuck Epstein has managed marketing communications and public relations departments for major global financial institutions and participated in the launch of industry-changing financial products. He also has written by-lined articles for over 50 publications, five books and served as editor and publisher of nation’s first newsletter on the topic of using the PC for personal investing and trading. (“Investing Online, 1994-1999). He also is a marketing consultant, writer and speaker on topics related to investor protection and opportunities in the very dynamic cannabis industry.

He has held senior-level marketing, PR and communications positions at the New York Futures Exchange, Chicago Mercantile Exchange, Lind-Waldock, Zacks Investment Research, Russell Investments and Principal Financial.

He has won national awards from the Mutual Fund Education Alliance (MFEA) and his web site, www.mutualfundreform.com, was named best small blog in 2009 by the Society of American Business Editors and Writers (SABEW).

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